Question

If a man earns $420 interest in one year at 7%, what was the amount of money invested?

Answer 1

`P = $6000`

Explanation:

Because the time is only one year, it does not matter whether we use compound or single interest.

`I = (PxxRxxT)/100`

`420 = (P xx 7 xx 1)/100" "larr` solve for `I`

`420 xx100 = 7P`

`P = (420xx100)/7`

`P = $6000`